Britain’s small and medium-sized businesses are being ravaged by weak demand, lack of funding, and late payment, and are in urgent need of help, business groups are warning.

A report by the CBI laid bare the hardship of Britain’s SMEs, which account for almost 60pc of private sector employment, as plummeting orders both at home and abroad in the three months to October wiped out confidence.

Smaller manufacturers struggled to sell their goods overseas, with exports falling at the fastest pace in more than three years, and further falls expected in the coming months.
Production fell over the period, margins are being squeezed and businesses expected to cut jobs in the coming three months.

“The economic climate clearly remains tough, with businesses exposed to subdued conditions both at home and in our major export markets,” said Lucy Armstrong, who chairs the CBI’s SME council.